ST Microelectronics ST Microelectronics

FINANCIAL HIGHLIGHTS

Year Ended December 31, (in millions, except per share data) 1997 1998(1) 1999(1) 2000(1) 2001(1)

CONSOLIDATED STATEMENT OF INCOME DATA:
Net revenues $ 4,019.2 $ 4,247.8 $ 5,056.3 $ 7,813.2 $ 6,356.9
Cost of sales (2,457.4) (2,623.0) (3,054.5) (4,216.9) (4,047.0)

Gross profit 1,561.8 1,624.8 2,001.8 3,596.3) 2,309.9
Total operating expenses (1,042.0) (1,101.4) (1,330.3) (1,813.6) (1,970.9)

Operating income 519.8 523.4 671.5 1,782.7 339.0
Net interest income (expense) (2.6) 8.7 35.6 46.7 (13.0)

Equity in loss of joint ventures (4.8)
Income before income taxes and minority interests Income tax expense 517.2 (532.1) (707.1) (1,829.4) (321.2)
Income tax expense (113.0) (120.4) (157.2) (375.1) (61.1)

Income before minority interests 404.2 411.7 549.9 1,454.3 260.1
Minority interests 2.4 (0.6) (2.6) (2.2) (3.0)

Net income $ 406.6 $ 411.1 $ 547.3 $ 1,452.1 $ 257.1
Earnings per share (basic) (2) $ $ 0.49 $ $ 0.49 $ $ 0.64 $ $ 1.64 $ 0.29
Earnings per share (diluted) (2) $ 0.48 $ 0.48 $ 0.62 $ 1.58 $ 0.29
Number of shares used in calculating earnings per share (basic) (2) 834.6 845.1 859.1 $ 885.1 893.3
Number of shares used in calculating earnings per share (diluted) (2) 839.15 864.3 901.2 936.1 902.0
CONSOLIDATED BALANCE SHEET DATA (END OF PERIOD):
Cash, cash equivalents and marketable securities (1) $ 702.2 $ 1,100.7 $ 1,823.1 $ 2,330.9 $ 2,444.2
Total assets 5,445.7 6,434.0 7,930.3 1,880.5 10,797
Short-term debt (including current portion of long-term debt) 424.6 191.2 . 123.2 141.6 129.3
Long-term debt (excluding current portion) (1) 356.4 755.8 1,348.5 2,700.5 2,771.5
Shareholders' equity(1) $ 702.23,307.4 4,083.3 4,563.9 6,124.6 6,074.7

(1) On November 16, 2000, we issued $1,480.0 million initial aggregate principal amount of zero-coupon unsubordinated convertible notes, due 2010, for net proceeds of $1,457.8 million. On September 22, 1999, we completed an equity offering of 8,970,000 shares of capital stock at $24.88 per share (adjusted for the 3-for-1 stock split) for net proceeds of $216.8 million. On September 22, 1999, we also completed a debt offering of $720.9 million initial aggregate principal amount of zero-coupon con-vertible Liquid Yield Optionª Notes, due 2009, for net proceeds of $708.3 million. On June 10, 1998, we completed an equity offering of 18,000,000 shares of capital stock at $12.03 per share (adjusted for the 2-for-1 stock split in June 1999 and 3-for-1 stock split in May 2000) for net proceeds of $208.8 million. On June 10, 1998, we also com-pleted a debt offering of $431.7 million initial aggregate principal amount of zero-coupon convertible Liquid Yield Optionª Notes (LYONs), due 2008, for net proceeds of $421.8 million.

On April 27, 2001, we issued a redemption notice for the remaining outstanding LYONs, due 2008, which were redeemed and converted into common shares in May and June 2001; the residual aggregate principal amount converted into common shares was $51.7 million. In 2001, we repurchased 9,400,000 common shares for $233.3 million and we have reflected these purchases at cost as a reduc-tion of shareholdersÕ equity. The repurchased shares have been designated to fund our most recent employee stock option plan.

(2) All share information has been adjusted to reflect the 2-for-1 stock split effected in June 1999 and the 3-for-1 stock split effected in May 2000. See Notes 2.10, 2.20 and 13 to the Consolidated Financial Statements.


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